This problem is far worse if blocks were 8MB: an 8MB transaction with 22,500 inputs and 3.95MB of outputs takes over 11 minutes to hash. If you can mine one of those, you can keep competitors off your heels forever, and own the bitcoin network
Well, probably not. But thered be a lot of emergency patching, forking and screaming
And this is with the initial optimizations completed to speed up Verification.
This means that If we hardforked a 2MB MaxBlockSize increase on the main tree and we softforked/hardforked in SepSig, we would essentially have up to a 8MB limit (3.5MB to 8MB) in which an attack vector could be opened up with heavy output and multisig tx which would crash nodes.
What you are saying here is completely factually inaccurate, the number of transactions does not increase hashing time. Furthermore you are assuming that miners are irrational and malicious which is flawed. If the miners collectively wanted to destroy the Bitcoin network they already could do that now. It is the underlying game theory and economics of Bitcoin that prevents this from happening in the first place.
If a miner decided to attack the network by creating excessively big blocks then other miners can simply choose to orphan those blocks and not build of them. Bitcoin Unlimited already has this build into the client as a preventative measure for such a scenario, which is a highly unlikely attack vector which furthermore is easily countered. I have written more extensively about this issue here:
https://bitco.in/forum/threads/gold-collapsing-bitcoin-up.16/page-203#post-7395https://bitco.in/forum/threads/gold-collapsing-bitcoin-up.16/page-208#post-7550